Lakehouse Capital, an investment management firm, published its “Global Growth Fund” second quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly return of 33.2% net of fees and expenses, was recorded by the fund for the second quarter of 2021, compared to 27.7% for its benchmark. You can view the fund’s top 5 holdings to have an idea about their top bets for 2021.
In the Q2 2021 investor letter of Lakehouse Capital, the fund mentioned Atlassian Corporation Plc (NASDAQ: TEAM), and discussed its stance on the firm. Atlassian Corporation Plc is a Sydney, Australia-based software company, that currently has an $81.3 billion market capitalization. TEAM delivered a 39.02% return since the beginning of the year, while its 12-month returns are down by 84.05%. The stock closed at $325.12 per share on July 30, 2021.
Here is what Lakehouse Capital has to say about Atlassian Corporation Plc in its Q2 2021 investor letter:
“Atlassian is one where we don’t have much to add. The co-founder-led business remains robust and was a very positive contributor to Fund performance over the course of its life — the Fund realised a +209% total return on the position — but the position had a de minimis impact on fiscal 2021 performance as we exited the small position we had left in October.”
Based on our calculations, Atlassian Corporation Plc (NASDAQ: TEAM) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. TEAM was in 67 hedge fund portfolios at the end of the first quarter of 2021, compared to 69 funds in the fourth quarter of 2020. Atlassian Corporation Plc (NASDAQ: TEAM) delivered a 36.86% return in the past 3 months.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage.
Disclosure: None. This article is originally published at Insider Monkey.
